Friday, September 07, 2012

Blog 2 The Continuous Rise of Airfare.

No one can deny the accomplished feeling one gets from finding a good bargain; whether it be for clothes, an electronic device, college textbooks, n'importe quoi as the french like to say.  Whatever your preference may be, my guilty pleasure comes from finding a super good deal on airfare, regardless of if I actually am traveling to the destination or not.  No, instant gratification is never the case when flight shopping, but perseverance and endurance pays off.  And finally, after weeks and weeks of searching for a cheap flight to surprise to my family for Christmas, a sigh of relief instantly came, but at the strikingly high dollar amount of $900 USD.  For some, traveling once was an affordable leisure of bountiful experiences, and for others a necessity to visit family and close friends living abroad.  But what was once an affordable leisure now is practically an investment.   

In the past year, many changes have affected the affordability of airfare for global nomads, businessmen, and the general population alike. The two main proponents of the current price hike are accredited to higher jet fuel costs, as well as recent merges among popular airlines. Without a doubt, these days none are unaffected by the current cost of fuel, as many Americans are having to dig deeper into their wallets at the gas pump. Just the same, airlines are being hit hard by the increasing price of fuel. Delta, a major American airline reports spending $12 billion USD this past year on fuel alone in comparison to $9 billion the previous year. Although airlines might have you fooled otherwise, there is another underlying cause of the recent price inflation of airfare. Due to the growing number of airlines filing bankruptcy in the past few years, many industry mergers are also to blame for this atrocity. The three main mergers have been: “Delta linking with Northwest; United, with Continental; and Southwest, with Airtran”. A capitalist economy cannot function without competition among companies being present. If so, it wouldn't be capitalism, but rather a communistic approach. Yes, these recent merges amongst airlines limit the amount of competition ensuring the cost of flights to rise as a shared monopoly subsists. In addition, these major airlines are now taking almost complete ownership of major airports throughout the United States. This is in part due to airlines having main hub airports, airports designated or primarily offering one specific airline as it's fundamental carrier. Smaller, regional airports are unable to compete without the funding of airlines who claim them as “hubs”. These two circumstances have lead to a 4.8% increase of domestic airfares throughout the country within the last year.

Many travelers are considering alternative methods of transportation, as flights are simply out of anyone's price range. Yet for the few determined, or better said those without a choice of how to cross the oceans of the world, it is simply the price one must pay to play the game.  

Date and Time:  Sept. 7th, 2012  ~16.50
USA Today - Fliers pinched as airfares take off.

No comments: